La Ceiba: Navigating Microfinance and Relationships in Honduras (A)

Abstract

This case follows the program director of La Ceiba, a Honduras-based microfinance institution, as he navigates four challenging negotiation scenarios involving the organization's loan clients. Students are asked to adopt the perspective of the Program Director and to consider how they would act in these negotiation scenarios that are characterized by unclear objectives and severely asymmetric power dynamics. How should they approach negotiation situations in which the power balance is heavily in their own favor? Should they exert this power and engage in a “hard” negotiation approach? Or, are there circumstances where a “soft” negotiation approach is warranted? In addition to helping students develop a framework about when to use soft versus hard negotiation approaches, two of the notable lessons that arise are (i) the role of apologies after misusing power and (ii) how even “using one’s power for good” can translate into paternalistic outcomes.

Prior advice research has focused on why people rely on (or ignore) advice and its impact on judgment accuracy. We expand the consideration of advice-seeking outcomes by investigating the interpersonal consequences of advice seekers’ decisions. Across nine studies, we show that advisors interpersonally penalize seekers who disregard their advice, and that these reactions are especially strong among expert advisors. This penalty also drives advisor reactions to a widely-recommended advice-seeking strategy: soliciting multiple advisors to leverage the wisdom of crowds. Advisors denigrate and distance themselves from seekers who they learn consulted others, an effect mediated by perceptions that their own advice will be disregarded. Underlying these effects is an asymmetry between advisors’ and seekers’ beliefs about the purpose of the advice exchange: whereas advisors believe giving advice is more about narrowing the option set by providing direction, seekers believe soliciting advice is more about widening the option set by gathering information.

This case follows Amira Rashad as she founds BulkWhiz, a Dubai-based buy-in-bulk grocery delivery platform. Following its launch in September 2017, BulkWhiz experiences rapid growth of 30 percent per month in the United Arab Emirates. Despite this initial success, Rashad finds herself at a critical juncture just nine months later, with a number of internal and external negotiations awaiting her. First, she is eager to convince her Chief Technology Officer to come on-board full-time, and needs to finalize details on his transition and compensation. Second, she is wrestling with how to expand her business beyond the UAE market. Finally, she is seeking series A fundraising, to fuel the company’s growth. How should she approach and sequence these negotiations, and what obstacles might loom?

Coffman, Katherine, Christine Exley, and Alpana Thapar. "BulkWhiz: Negotiating as a Startup Founder in the UAE." Harvard Business School Case 919-004, October 2018. (Revised November 2018.)
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In 2018, Mellody Hobson, President of Ariel Investments, the largest minority-owned investment firm in the U.S., was considering how best to divide her time and use her position and personal characteristics to push for positive change at her firm and in society at large.